The Fast-Moving Consumer Goods (FMCG) sector in Africa was estimated at $1.4 trillion in retail spending in 2016. This was largely the result of increasing population growth, urbanization, and an increase in disposable income which are expected to contribute to the growth of the FMCG market in Africa. E-commerce, a key growth driver for the FMCG sector in Africa, is expected to generate USD 67.8 billion by 2027 at an annual growth rate of 13.53% (CAGR 2023 – 2027)
Nigeria is the largest FMCG market in Africa, with an estimated household consumption spending of over $350 billion in 2016. It is also one of the fastest-growing with a CAGR of about 20% per annum. South Africa has an estimated household consumption spending of about $250 billion. Growth was estimated to be at around 5% per annum. This is largely the result of South Africa being a more mature market.
The FMCG market in Ghana is composed predominantly of foreigners and is worth about $2 billion. The economic growth rates achieved in the country over the past few years have increased household disposable income levels.
Kenya has an estimated household consumption spending of $35 billion which is expected to grow steadily in the coming years. The country is expected to continue its steady growth in the coming years.
Ivory Coast has an estimated household consumption spending of $15 billion and its FMCG sector is expected to continue to grow, driven by a growing population, increasing urbanization, and rising incomes.
Senegal has an estimated household consumption spending of about $9 billion. The rise of online shopping has revolutionized the FMCG and retail sectors by making shopping more accessible and increasing the size of the sector.
Population growth and the increasing rate of urbanization continue to be the driving forces behind the establishment of modern retail channels such as supermarkets, hypermarkets, and convenience stores, which provide a ready market for FMCG products. Although the informal makes up more than 50% of the distribution channels for FMCGs, the formal sector is growing fast with the influx of global retail chains into Africa. Most African governments and investors are working to support the development of formal retail channels to improve product quality, safety, and access to finance.
Last Updated: 1 March 2023
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